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Raworth points out that economics in the 20th century “lost the desire to articulate its goals”. It aspired to be a science of human behaviour: a science based on a deeply flawed portrait of humanity. The dominant model – “rational economic man”, self-interested, isolated, calculating – says more about the nature of economists than it does about other humans. The loss of an explicit objective allowed the discipline to be captured by a proxy goal: endless growth.

In her book, Raworth emphasizes that economics should provide a model that doesn’t require growth in order to meet “the needs of all within the means of the planet.” And, she offers one. As Monbiot points out, we have a messy situation where power rests in the hands of a few who really don’t seem terribly concerned to acknowledge the planet’s limits, or, therefore, the limits to economic growth, so mustering political will might not be so easy.

Here’s how our current economic system works, in a nutshell, according to Monbiot:

The central image in mainstream economics is the circular flow diagram. It depicts a closed flow of income cycling between households, businesses, banks, government and trade, operating in a social and ecological vacuum. Energy, materials, the natural world, human society, power, the wealth we hold in common … all are missing from the model. The unpaid work of carers – principally women – is ignored, though no economy could function without them. Like rational economic man, this representation of economic activity bears little relationship to reality.

Raworth’s model “embeds” economics into existing natural and social systems, “showing how it depends on the flow of materials and energy, and reminding us that we are more than just workers, consumers and owners of capital.”

The diagram consists of two rings. The inner ring of the doughnut represents a sufficiency of the resources we need to lead a good life: food, clean water, housing, sanitation, energy, education, healthcare, democracy. Anyone living within that ring, in the hole in the middle of the doughnut, is in a state of deprivation. The outer ring of the doughnut consists of the Earth’s environmental limits, beyond which we inflict dangerous levels of climate change, ozone depletion, water pollution, loss of species and other assaults on the living world.

The area between the two rings – the doughnut itself – is the “ecologically safe and socially just space” in which humanity should strive to live. The purpose of economics should be to help us enter that space and stay there.

It’s hard to understate how exciting this revelation is – a healthy escape from our current predicament. We need an economic system that works with the Earth, instead of against it, to provide for all of us. Can we do it?

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Slideshow

Doughnut Economics: the long-sought alternative to endless growth

Kate Raworth Doughnut Economics

George Monbiot presents Kate Raworth's alternative to endless economic growth: Doughnut Economics - which meets "the needs of all within the means of the planet."

Kate Raworth Doughnut Economics

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George Monbiot presents Kate Raworth's alternative to endless economic growth: Doughnut Economics - which meets "the needs of all within the means of the planet."

Man with buffalo

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Finding a healthy alternative to the prevailing growth model that has strained the planet to bursting is the holy grail of environmental economics. And it looks like maybe we've found it. George Monbiot, the most dynamic environmental journalist I know, wrote about Kate Raworth's Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist, which "redraws the economy" in such a way that the planet and its inhabitants can thrive, with or without growth. It's so similar to the kind of closed-loop thinking we see frequently on Inhabitat, whether in permaculture design or William McDonough's new approach to integrating the carbon cycle, it seemed important to share. I'll point out a few excerpts below, but please do read Monbiot's longer analysis. It starts with what he says is the most important question: "So what are we going to do about it?"